It may not be an ideal time to be talking about value versus growth when all you are thinking about is a defensive position in the market. But, if you are a long term investor, you are not looking at the daily swings and striking a balance between value and growth. Value investing is investing in cheap stocks while growth investing is the opposite or investing in companies poised for growth. Established growth companies like Apple are expensive with a PE >2-4 times the market average. Bernstein points out that Professor Haugen studied the value effect in the mid-1990’s and noted that 20% of stocks with the highest PE’s (growth stocks with an average PE of 42) had an earnings yield of 2.36% versus the 8.3% for value stocks (PE 11.9%). Earnings yield is the inverse of the PE or earnings/price.Bernstein, a physician turned money manager, also comments that the risk of value stocks is lower than growth stocks partly because they stand up better during bear markets. Comment: Read ‘The intelligent asset allocator' by Bernstein.